U.S. Department of Housing and Urban Development Pass-through Entity: City of Charlotte, North Carolina Program Name: Home Investment Partnerships Program Federal Assistance Listing Number: 14.239 Material Weakness – Eligibility Finding 2025-002 Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: For all five (5) participants tested, while they were determined to be eligible, the Organization did not have formal documentation evidencing review and approval of client eligibility packets by an individual independent of the preparer. Questioned Costs: None noted. Effect: Without the documented evidence of review, eligibility determinations cannot be readily substantiated, increasing the risk that assistance could be provided to individuals who do not meet program eligibility requirements. Cause: The Organization does not have a formal policy or standardized process requiring documentation of supervisory review and approval of client eligibility packets. Recommendation: The Organization should consider implementing a formal policy requiring documented supervisory review and approval of all client eligibility packets and retain such documentation to evidence compliance with program requirements. Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development Pass-through Entity: City of Charlotte, North Carolina Program Name: Home Investment Partnerships Program Federal Assistance Listing Number: 14.239 Significant Deficiency – Special Tests: Housing Quality Standards Finding 2025-003 Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: For all five (5) properties tested, while they all occurred, the Organization did not have formal documentation evidencing review and approval of Housing Quality Standards inspection reports by an individual independent of the preparer. Questioned Costs: None noted. Effect: By not having sufficient documentation, the Organization cannot demonstrate that Housing Quality Standards inspections were appropriately reviewed, increasing the risk that units may not consistently meet required housing quality standards. Cause: The Organization does not have a formal policy or standardized process requiring documentation of supervisory review and approval of Housing Quality Standards inspection reports. Recommendation: The Organization should consider implementing a formal policy requiring documented supervisory review and approval of all Housing Quality Standards inspection reports and retain such documentation to evidence compliance with program requirements. Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development Pass-through Entity: City of Charlotte, North Carolina Program Name: Home Investment Partnerships Program Federal Assistance Listing Number: 14.239 Significant Deficiency – Allowable Costs and Activities Finding 2025-004 Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There were four (4) out of forty (40) samples tested where the reasoning for the allocation of payroll related to the administrative function could be substantiated; however, sufficient documentation of the review and approval of the reason for the allocation for the applicable employees was not sufficiently documented. Questioned Costs: None noted. Effect: By not maintaining a clearly documented methodology or effort certification to support payroll allocations, the Organization increases the risk that unallowable costs or activities may go undetected prior to submission of reimbursement requests to the grantor. Cause: The Organization did not have formal policies or procedures in place to formally document, review, and retain support for payroll allocations for employees working across multiple programs prior to submitting reimbursement requests to the grantor. Recommendation: The Organization should further evaluate and formalize its process for documenting and approving the allocation of employee time for individuals who do not work 100% of their time on a single program to ensure allocations are properly reviewed in determining allowable costs and activities. Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Treasury Pass-through Entity: Mecklenburg County, North Carolina Program Name: Coronavirus State and Local Fiscal Recovery Funds Federal Assistance Listing Number: 21.027 Significant Deficiency and Nonmaterial Noncompliance – Allowable Costs and Activities Finding 2025-005 – Repeat Finding Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There were two (2) out of forty (40) samples tested where salaries for individuals working on the grant were allocated to the grant based on the contracts budgeted amount for each position rather than based on their actual time and effort and salary paid during the year for each employee. Questioned Costs: $22,000 – The questioned costs were related to a subset of allocated employees. Each allocated employee was recalculated in total to determine the known questioned costs for the period under audit. Effect: By not having a clearly documented review process, unallowable costs and activities may go undetected prior to filing a request for reimbursement with the grantor. The Organization should further evaluate their process for documenting the allocation of time by employee for those that do not work 100% of their time on one program to ensure proper documentation and approval of the allocation of time is based on actual time spent in determining allowable costs and activities. Cause: The Organization did not have formal policies or procedures in place to document, review, and retain support for payroll allocations for employees working across multiple programs prior to submitting reimbursement requests to the grantor. Recommendation: The Organization should further evaluate and formalize its process for documenting and approving the allocation of employee time for individuals who do not work one hundred percent of their time on a single program to ensure allocations are based on actual time spent and are adequately supported in determining allowable costs and activities. Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Treasury Pass-through Entity: Mecklenburg County, North Carolina Program Name: Coronavirus State and Local Fiscal Recovery Funds Federal Assistance Listing Number: 21.027 Significant Deficiency and Nonmaterial Noncompliance – Procurement Finding 2025-006 – Repeat Finding Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management. Condition: There was one (1) contract out of two (2) contracts tested where Roof Above did not retain documentation demonstrating that the bid was publicly advertised as required under Uniform Grant Guidance procurement standards. Additionally, Roof Above did not perform or retain documentation evidencing verification that the vendor was not suspended or debarred on the System for Award Management (SAM.gov) prior to procuring services. Questioned Costs: None of the nonmaterial noncompliance items resulted in questioned costs. Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor. Cause: The Organization did not have formalized procedures in place to ensure procurement requirements under Uniform Grant Guidance were consistently documented and reviewed, including public advertisement of bids and verification of vendor suspension or debarment status, prior to entering into contracts. Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding. Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Treasury Pass-through Entity: Mecklenburg County, North Carolina Program Name: Coronavirus State and Local Fiscal Recovery Funds Federal Assistance Listing Number: 21.027 Significant Deficiency – Reporting Finding 2025-007 – Repeat Finding Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: For two (2) of the nine (9) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission. Questioned Costs: None noted. Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Cause: The Organization did not follow its policy to document approval of reports prior to submission. Recommendation: While the Organization made updates to policies and procedures surrounding reporting during the current year to address the prior year finding and most reports did have a reviewer’s signature, the Organization should ensure this policy is adhered to in order to ensure all submitted reports are reviewed prior to submission. Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.